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Vladimir Putin and Qatari gas sheikhs are not to blame for home-grown net zero policies that have left Britain with dangerously inadequate non-weather dependent generating capacity.

In this, Britain is not alone. As other countries are finding out, having more renewables on the grid destabilises the electricity market. Sweden has also had soaring electricity prices, says Ebba Busch, Sweden’s deputy prime minister and energy minister. Like Britain, Sweden has an extremely weather-dependant energy system which makes prices highly volatile, worsened by its German neighbour on the other side of Baltic. The need, Busch argues, is for ‘more dispatchable power production’.

This is politically impossible for the Starmer government. Labour is trapped by net zero and decarbonising the grid constitutes its overriding mission. So far, neither the Conservatives or Reform have stepped up. Tory leader Kemi Badenoch calls herself a net-zero sceptic and Reform’s Nigel Farage wants more nuclear. Whatever the merits of nuclear, there is no way in which new nuclear power stations can be built and commissioned fast enough to offset the retirement of Britain’s old ones, let alone substantially increasing the amount of nuclear power. They should be thinking and talking like Ebba Busch: Britain needs an emergency programme to build 20 GW of new gas-fired power stations. If that means suspending net zero, they should make the case that keeping the lights on and electricity bills down is a price worth paying.

The government gives successful bidders guaranteed prices, irrespective of how much – or, more often, how little – the market values their output. Consumers are then forced to make up the difference between the market price and the set strike price they bid for. The average strike price for AR6 was very nearly £80 per MWh. Based on Professor Hughes’s analysis of load factor decay and rising maintenance costs, there is a high risk that offshore wind becomes lossmaking well before Year 12. Floating offshore wind, which Miliband says ‘is at the heart of the government’s mission to make Britain a clean energy superpower’, was awarded an eye-watering strike price of £176 per MWh. Larger subsidies and floating offshore wind are hardly conducive to cutting bills.

Until mid-October, the wholesale price of electricity in 2024 averaged £78.70 per MWh. The more wind and solar added at strike prices above wholesale prices mathematically drives up the amount of subsidy consumers must pay. But the cost of renewables doesn’t stop there. Because wind farms are mostly located hundreds of miles from where electricity is used, when grid connections get congested, wind farms are paid constraint payments not to generate electricity.

Decongesting all the wind power on the grid doesn’t come cheap either. Miliband’s Clean Power 2030 Action Plan, published earlier this month, envisages building twice as much new transmission infrastructure in the next five years as was built in the past decade. The faster the planned build-out, the higher the cost. It means that renewable strike prices are a floor on which constraint payments and higher network costs are added.

That’s not all. There’s a second net-zero factor driving up energy costs. Net-zero policies have been forcing conventional power stations off the grid. Britain’s dispatchable generating capacity (principally coal, gas and nuclear) peaked in 2010, by 2020 declining by 25.1 GW and shrinking dispatchable capacity by 28.5 per cent. This was mostly because 18.3 GW of coal-fired capacity was retired as Britain demonstrated its green virtue to the world by powering past coal. The problem comes when there’s insufficient wind to power the grid. That’s what happened this autumn. Unseasonably windless conditions saw wholesale electricity prices rise through October and November with a huge spike at the beginning of December.

The latest renewable lobbyist talking point is that gas sets the wholesale electricity price. The implication is that gas prices are driving up the cost of electricity. However, gas prices this year have been lower than they were in 2023. The culprit behind the surging electricity prices is not the price of gas, but politicians kicking coal off the grid and Britain not having sufficient gas-powered generating capacity to meet demand when there’s not enough wind.

Still a bit more to come.

The government’s net-zero noose draws tighter. At energy questions in the House of Commons on Tuesday, the Conservative MP Charlie Dewhirst asked the Energy Security and Net Zero Secretary Ed Miliband if the recent report by the National Energy System Operator (Neso) projected higher or lower bills under his policies. Miliband replied that Neso forecast lower overall costs. ‘It is completely logical to say that that will lead to a reduction in bills,’ he said.

Logic and historic data point in the opposite direction. Between 2009 and 2020, the average price of electricity sold by the Big Six energy companies rose by 67 per cent from 10.71p per kilowatt hour (kWh) to 17.92p per kWh. This wasn’t caused by any increase in the cost of natural gas. In fact, the average price paid by major power generators fell by 15 per cent over the period. There was, however, a spectacular explosion in the amount of wind and solar on the grid which rose from 4.5 gigawatts (GW) in 2009 to 37.95 GW in 2020.

The upward pressure on prices will only increase as Miliband pushes for more offshore wind. Earlier this week, the Financial Times reported a senior energy investment banker commenting on the hubris of the offshore wind industry, which has been hit by higher interest rates and supply chain inflation. Renewable energy projects require enormous upfront investment costs. The pay-off, its advocates argue, is that renewables have no fuel input costs. But it would be a mistake to assume they have minimal ongoing costs.

The North Sea is a harsh environment for wind turbines; fixing a defective wind turbine in the middle of the ocean is no easy matter. A 2020 forensic analysis of wind company accounts by Edinburgh University’s Professor Gordon Hughes found that Year 1 operating costs for deepwater wind projects averaged £44 per megawatt hour (MWh), rising to £82 per MWh in Year 12. Moreover, the output efficiency of wind turbines degrades at a rate of around 4.5 per cent a year. When plotted against the market price obtained for wind output, Hughes concluded that ‘a significant portion of wind output is expensive to produce and of no value in terms of its contribution to national wellbeing’.

Renewable subsidies are awarded in allocation rounds. The fifth allocation round (AR5), conducted under the previous government, was a dud because of rising project costs caused by higher interest rates and supply chain inflation. Coming into office, Miliband was determined to make a big splash with AR6. He threw bill payers’ money at it with a record-breaking £1.555 billion subsidy pot. The government accepted bids totalling 9.6 GW, which includes 5.34 GW of offshore wind and 3.29 GW of solar, capacity which is useless when it’s likely to be most needed to meet peak electricity demand on winter evenings.

Sorry rather long - tbc

Rachel Reeves may be forced to announce emergency tax rises in the spring if the economy continues to deteriorate, analysts have warned.

This reads "IF" far more likely to be "WHEN". She will find her "black hole" will be full of unemployed and or closed businesses. With luck, maybe she will also be out of a job.

As an interested party, perhaps you could share your opinion on the news announced today over at Serica.

Yes why not: Minimum wage up, Employers NI up, coffee prices up. Every time I pass a Costa Coffee always packed, WFT sounds about right, then replace them with more charity shops. Everyones a loser, it's the UK direction.

"Sod the country. the government dont give a toss about the people. id welcome a takeover asap."

Never mind the "people" both the Tories and Labour only want to tax the oil sector out of business with the nutty Miliband leading the charge.

Https://www.telegraph.co.uk/politics/2024/12/07/net-zero-soldiers-at-risk-battlefield-evs-combat-warnings/

All this worry over the dividend: Lets be clear - the company's plan is to continue to grow the dividend through to 2027 at an annual rate of 2% and to also do buybacks to the tune of £200m, indicating today the buybacks may well be bigger.

The yield is over 3% higher that the FTSE100 average return rate - the share price in undervalued by the market, IMO leaving the company vulnerable to a predator, most likely from the US.

Gasoline sales in India hit 3.42 million metric tons in November, which was a 9.2% increase on the year, the Economic Times has reported, noting diesel demand also grew, with November sales adding 8.4% on the year to 8.158 million tons.

Aviation fuel demand also grew last month, further evidence of India’s growing demand for energy across fuel categories and the growth trajectory of its economy, highlighted by the increase in demand for diesel fuel.

India is the world’s third-biggest importer of crude oil with over 80% of its demand covered by foreign crude. This has made the country highly price-sensitive and open to opportunities to diversify its supply, from both domestic and foreign sources.

Domestic resources may hold significant promise, with up to 22 billion barrels in hitherto unexplored regions of the subcontinent’s sedimentary basin. To tap these, India would need help from Big Oil. Until such time as these reserves are confirmed, India remains reliant on imports—and OPEC production policies.

Last month, the country’s petroleum minister called on the cartel and other producers to get together and discuss ways to stabilize the price of crude. India and other large consumers need predictability and stability in oil prices, Hardeep Singh Puri told Reuters last month on the sidelines of the ADIPEC energy conference in Abu Dhabi.

“I'm hoping as a professional that all the players in this game will see a reason that... both producers and consumers can sit down together, have a discussion on what is a realistic price because it is not as if some production is taken off,” Puri said.

Natural gas demand in India is on a growth trajectory as well. Projections are for twofold growth by 2040 and threefold by 2050, despite a parallel increase in wind and solar capacity for electricity generation as planned by the government.

The more our current government destroy business in the UK the quicker LGEN will attract interest from overseas buyers. They are always on the lookout for undervalued stable companies, and this is one of those.

Https://www.telegraph.co.uk/politics/2024/11/30/miliband-cheap-green-energy-plan-gale-blows-every-day/

"We need a party that genuinely puts the country first and which is not afraid to apply common sense where needed. Firm but fair would make a nice change."

"COMMON SENSE" - Our polititions do not appear to have any, they are following the line of "what is everyone else doing" well we want to be the "leaders" we will do the opposite and if you don't achieve our goals - we will fine you and then proceed to raise your taxes to buy what we need at higher prices and greater damage to the worlds environment. We are Great Britain.

In another few lifetimes there will be no "British" in Great Britain.

Todays rise will have cost £6m+, increasing the position a few days ago may result in someone being sacked - good.

It is quite outrageous that our Prime Minister appear to be turning a blind eye and a deaf ear to all the articles that have drawn attention to this "net zero nonsense"

There is a need for him to be interviewed on TV (Sunday morning politics show) or maybe for Farage to challenge him in Parliament so that his opinion can become a matter of public record.

It has taken the closure of the Luton factory for action to be taken - Miliband is proposing to spend £20bn+ on two carbon capture project. Other bigger nations have previously spent billions on such projects and subsequently abandoned them.

Who is controlling this man, he needs to be exposed, sooner rather than later.

Https://www.telegraph.co.uk/business/2024/11/27/trumps-energy-secretary-says-net-zero-policies-britain-poor/

Https://www.telegraph.co.uk/news/2024/11/26/ed-miliband-hammering-final-nail-in-britains-coffin-labour/

Helikon are short over 23m shares

Following on - Stellantis, owners of Vauxhall has announced plans to close down its Luton plant putting approx 1,100 jobs at risk.

Government rules to speed up the transition to electric vehicles have been cited to be partly to blame (no doubt the proposed changes to employers NI also encouraged the move)

Too little too late - The business secretary Jonathan Reynolds said the government would consult on changes to the EV sales rules, he said they are not working as expected.

IMO this is just the start and industry and businesses have a further 5 months to implement changes to staffing levels and budgets to leave the government significantly short of their tax receipts which will be "not as expected".

Oh whilst I am at it, has anyone any idea what impact "flooding" (we have a lot going on right now) has on "Heat Pumps". I am aware that when a car engine get immersed in water it becomes a write off, will the heat pump just warm the water so occupiers don't freeze, or will they all just be electrocuted, - serious question.

The Autumn Budget has provided much needed clarity over future investment allowances. The remainder of the Triton well campaign will continue to benefit from full tax relief, and the retention of allowances opens up opportunities in the wider portfolio. Our subsurface team are continuing to work up options for the untapped potential around the Bruce Hub.

Is there a clue here in the "Autumn Budget" comment to help JOG.